Pinterest Stock (PINS) Under Pressure: Downgrade Ahead of Earnings Adds To Woes

Pinterest stock (PINS) dipped below $22 today, precariously close to its lowest levels in recent memory and extending a bruising start to 2026. After what has been a tough year for PINS bulls, a fresh analyst downgrade into earnings raised questions about the social media platform's strategic pivot toward artificial intelligence.

The Pinterest stock price is nursing year-to-date losses of 16.23 percent with barely one month of trading complete. A glance at the 1 year chart below highlights what has been almost relentless pressure since August.

The latest blow came from HSBC, which downgraded Pinterest to Hold from Buy and slashed its price target to $24.90 from $34.50. The firm cited concerns over the abrupt nature of the company's recent workforce reduction announcement, which came just ahead of its fourth-quarter earnings report.

HSBC analysts described the move as a sharp reversal from Pinterest's recent hiring spree, suggesting the company may be bracing for a softer near-term outlook than previously anticipated.

The downgrade follows Pinterest's January 27 disclosure that it would eliminate approximately 15 percent of its workforce, affecting between 700 and 800 employees. The restructuring forms part of a broader strategic realignment aimed at prioritizing AI-focused roles and products. Pinterest expects to incur pre-tax charges ranging from $35 million to $45 million related to the layoffs and planned office space reductions, with the restructuring targeted for completion by the end of September 2026.

Markets have responded poorly to the announcement, with the stock falling more than 9 percent in midday trading on the day of the disclosure. The selloff reflects growing skepticism about Pinterest's ability to compete effectively in an increasingly AI-driven digital advertising landscape. HSBC noted that while Pinterest is not new to artificial intelligence, its sales performance has increasingly diverged from peers perceived as AI winners. The firm expressed caution that Pinterest's renewed AI push is coming without any clear indication of cost savings or revenue acceleration.

The HSBC downgrade represents the latest in a series of analyst downgrades that have weighed on sentiment. In December, Wedbush cut its rating to Neutral from Outperform, lowering its price target to $30.00 from $34.00, citing mixed third-quarter results and a lower-than-expected revenue growth forecast. 

On a one-year basis, Pinterest shares have declined 32.46 percent, significantly underperforming both the broader market and many of its social media peers.

The company's forthcoming fourth-quarter earnings report will be closely scrutinized for signs that management's AI investments are beginning to bear fruit. Markets will be looking for concrete evidence of revenue acceleration, margin improvement, or competitive differentiation that would justify the strategic shift and associated disruption.

Until then, Pinterest faces an uphill battle to restore confidence and reverse the downward trajectory that has characterized its performance over the past year.